INTA row about big business lobbying

April 14th 2011 International trade

Corporate lobbying triggered an angry debate when the European Parliament’s committee on international trade (INTA) met yesterday, following Carl Schlyter MEP's interview with Corporate Europe Observatory (see here for the video of the debate, starting in minute 9’50). His comments about the excessive influence of corporate lobbyists were heavily criticised by MEPs from the European People's Party (EPP) who defended the importance of listening to industry.

Talking about his role as rapporteur for the European Parliament on the future of EU member states' bilateral investment treaties, Schlyter had said he had never seen such an extreme example of MEPs focusing solely on big business interests.

EPP in defence of corporate lobbying

Daniel Caspary (Germany, EPP) demanded an apology from Schlyter for these remarks. He argued that every elected representative had the right to decide who to speak to and who not and the right to table amendments with the support of others. What counted was the content of amendments – not their origin, Caspary argued.

Pawel Zalewski (Poland, EPP) likewise criticised the interview and suggested that Schlyter was trying to undermine the credibility of the MEPs involved in the dossier because he had not found a majority for his position. He asked Schlyter not to reiterate his comments.

Referring to his joint work with MEP Pablo Zalba Bidegain (EPP, Spain) on the EU-Korea free trade deal, Robert Sturdy (UK, European Conservatives and Reformists – ECR) stressed that they “could not have taken decisions... without the support and help of industries for which we were passing legislation”. Zalba Bidegain was one of the MEPs exposed in the ‘cash-for-influence’ scandal, tabling amendments to change EU law in return for promised payments from undercover journalists posing as lobbyists.

Caspary, Zalba Bidegain and Sturdy were all mentioned in CEO's recent report on the future of Europe's international investment policy for having tabled amendments that appeared to completely mirror industry's demands, undermining attempts by the Greens, Social Democrats and the Left to rectify the current unbalanced investment regime.

Under the current regime foreign companies have the right to sue states if they find that a law in the area of public health, environmental protection or social policy interferes with their profits. This has led to dizzying sums being paid in compensation to big business across the world, with taxpayers paying the price. As a result governments’ ability to legislate in the public interest has been severely undermined.

Dominance of corporate lobbyists is a threat to good decision-making

Defending himself against the EPP attack, Schlyter said he had not criticised lobbying per se, but had criticised the lack of transparency and the dominance of big business interests in the Brussels lobby scene. He said: “If you have money, you have more possibilities to lobby... This unbalance is a threat to good decision making.”

Liberal MEP Marielle de Sarnez (France) seemed to support Schlyter, declaring the cash-for-influence scandal an “absolute catastrophe” and a “disaster for the credibility of the Parliament as a whole”. She called for “far reaching measures” that went “much further” than what was already proposed by the Parliament’s working group for a new code of conduct for MEPs.

The EPP attack on the Schlyter report

The heated debate followed the committee's vote on Schlyter’s report. The EPP, backed by the ECR and some Liberals, blocked proposals to eventually withdraw those existing investment treaties signed by EU member states, which are incompatible with the values that, according to the Lisbon Treaty, guide the EU’s foreign policy: democracy, human rights, sustainable development and poverty eradication.

How can anyone vote against a proposal like that?

Well... blocking this was one of the main demands of law firms and corporate lobby groups such as the German industry federation BDI and BusinessEurope. They wanted to see existing BITs integrated into EU law as fast as possible – without any examination of their content. They have also openly opposed the integration of ‘broad social concepts’ such as the protection of the environment, labour and human rights into investment treaties.

At the end of December 2010, a lawyer's blog comment about Carl Schlyter’s initial proposal already predicted that the reference to principles such as human rights, poverty eradication and equality “will, no doubt, be coined as a dangerous heavy politisation of investment treaty law and an unacceptable reflection of the rapporteur’s political colours”. The commentator predicted that EU member states and law firms “will probably try to get this proposal struck down already in the INTA itself”. Yesterday, this prophecy seems to have come true.

The battles ahead

But the discussion about Europe’s investment policy is not over. Schlyter’s report on the future of existing EU member state treaties will be voted on in the Parliament’s plenary in May. This is the chance for MEPs to break free from the undue influence of those who make big profits from the current investment regime and send a strong signal for a more balanced policy in line with human rights and sustainable development.

Behind closed doors, the Commission and EU member states are also pushing for dangerous investment provisions in the EU’s future free trade deals with countries such as Canada, India and Singapore. Civil society groups have already called upon MEPs to refuse to give consent to these deals if they do not respect the capacity for public intervention and do not include investor obligations. This would be a good opportunity for the Parliament to prove that it is serious about its call for a "progressive" investment policy.